8 Ways You’re Messing Up Invoicing
Your business runs on invoices. Without those neat and nifty payment requests, your clients have no clue when or how much to pay, and when your clients are clueless, they won’t cough up the money your business needs to grow. Unfortunately, despite the importance of invoices, plenty of businesses get them wrong ? and they get them wrong in a big way.
To pay on-time and in-full, clients need their invoices just-so. Here are some of the biggest invoicing mistakes preventing your business from collecting what it is rightfully due.
You Don’t Itemize
You might think it’s easier to send along the total charges for your services so your clients know what they need to pay, but neglecting to explain how you arrived at your final number is a major mistake. Your invoices are your best records for projects completed and payment received; a client might argue that he already paid you for a particular service, and without itemized invoices, you will have no evidence he is wrong. Every charge you request should be explained with enough detail for both you and your clients to understand what they are paying for.
You Don’t Restate Your Terms
Your clients have a lot on their minds, and most of them won’t bother trying to remember the terms of your business agreement. Though you should send a copy of your original contract when you first begin your business relationship, you should also briefly restate your rules on the invoice. Sometimes, clients get involved only after a project is complete ? when they begin inquiring about revisions, additional customer support, and refunds and returns ? so reiterating your policies on your request for payment helps to set professional boundaries.
You Forget a Due Date
You might send out your invoices every two weeks like clockwork, but you won’t get payments back “on time” if your clients don’t know what “on time” means. Every invoice must have a definite due date, which means a specific calendar date in the near future. Most clients don’t respect phrases like “due in 30 days,” which seems distant and indistinct, so including a precise date is crucial.
You Wait to Be Paid
When you make mistakes on your invoices, your clients don’t pay the way you want them to, and when your clients don’t pay, your business doesn’t have enough budget to function. Instead of waiting around for your clients to send along payments, you can collect on your invoices today by working with an invoice factoring company. Essentially, this allows you to get an advance on your unpaid invoices you can use to maintain or grow your business.
You Don’t Care How It Looks
Sending out the final invoice might signal the end of your business relationship, but that doesn’t mean the invoice doesn’t matter. All of your business’s paperwork contributes to your business’s brand identity, so including essential brand symbols ? like particular fonts and logos ? is a subtle way to continue marketing even after a project is complete.
You Add Unexpected Fees
You know how much you hate being surprised by additional charges, so you should never do that to your clients. Any and all fees you levy must be discussed (and put in writing) before you begin work. If a client requests a custom service, you must agree to payment terms ahead of time, allowing them several opportunities to back out before you modify the charges on the invoice. A client who is caught off-guard by an unexpected number on your invoice is not a return client.
You Never Follow Up
Some businesses believe that once the invoice goes out, the relationship is over. However, when a payment becomes late, you absolutely must follow up with your clients. The longer an invoice goes unpaid, the less likely you are to ever see that money. When a due date passes, a quick call to your clients ? particularly, the person in charge of finances ? is definitely in order. You might have alternative payment options available, like credit or installments, to ensure you get the funds you deserve.
You Make Silly Mistakes
Small mistakes can have major ramifications for your business. For example, you could input improper mailing information, sending the invoice to the incorrect person, company, or building. Alternatively, you could embarrass your business with typos or misspellings. Clients will notice every mistake ? and judge you harshly for it ? so is pays to proofread.